Business Plan

Introduction Focus your thinking Establish realistic strategy Financing and other support Reaction by others

Four Questions What service or product does your business provide and what needs does it fill? Who are the potential customers for your product or service and why will they purchase it from you? How will you reach your potential customers? Where will you get the financial resources to start your business?

Definition Document that can convince the reader that the business can produce enough revenue to make a satisfactory profit and therefore attractive as an investment opportunity. Many reasons to write one: BP should sell the writer/reader on the business: Writer: so that you can go out and do it, Reader: to invest in it

Confidence of knowing the issues Improve chances of success

Many Purposes in Real Life Bank Financing Strategic alliances Large contracts Key employees Mergers and acquisitions Mgt team motivation New product launch

Principles of BP No right way: plans can differ Be creative but set a limit Concise and focused Captures energy and personality of business leader Include negatives and issues Spend some time on it

Sections of a Business Plan Cover Page: contact name and info Table of contents Executive summary Company description The market Competitive analysis Marketing & Sales plan Operation plan Management Structure Future developments Financials

The Executive Summary The single most important part of your business plan Need to explain business concept clearly & concisely in a way that leads the reader to ask for more This is the first impression the reader will get about your company/project

Divide into paragraphs that mirror the sections of your marketing plan Keep it brief Use bullets Include a small chart or graph if it helps clarify a point Use space to break-up text blocks

The Company: Past, present & future Basic factual details about your company The Executive summary creates a compelling case for your business's success, this section fills in the specifics Provides information about company ownership, location, type of company, milestones, products, industry status, funding.

Target Market Description Identify types of people / business most likely to be your customer. Explain their needs Demography of target market Motivating factors for purchase decisions Market Size Market trends

The Competition

Identify competition types direct / indirect Identify your specific competitors Determine your competitors market share Define competitive positions Highlight your competitive edge Evaluate barriers to entry and potential future competitors

Marketing & Sales Plan Summarize your marketing message Describe your marketing vehicle Additional marketing & sales strategies Sales team description

Operations Plan Location & facilities Production & quality control Inventory control Supply & distribution Order fulfillment and customer service Equipment & technology Financial control systems Determine your key operations elements Highlight your operational advantage Address current / potential operational challenges

Management Structure Highlight key team members Predict future management needs Describe your staffing structure Identify Board Members, Advisors and Consultants

Future Development Define long term goals Establish future milestones Assess the risks Explore exit options

Financials Income Statement Cash-flow projections Balance Sheet Sources & use of funds Additional supporting financial statements

Marketing Plan 1. 2. 1. 2. 3. 3. 4. 5. 6. 7. 8. 9. Executive summary Environmental analysis Marketing environment Target market Marketing objectives & performance SWOT analysis Marketing objectives Marketing strategies Marketing mix Marketing implementation Financials Evaluation and control

Format & Layout Choose a clear font: Serif fonts for body Garamond, Palatino, Times New Roman Sans Serif fonts for headings Arial, Franklin Gothic, Verdana Use no more than two fonts Be restrained in use of italics, Bold, underline Size 10 12 is best for body text & 12 14 for headings

Charts & Graphs Bar charts are useful for showing trends Pie charts are effective for depicting market composition, etc. Pie charts are effective as indicators for market composition

Binders & Folders If you use business folders, chose a business color like black, blue or grey Have a clear cover sheet with the title page on top

Cover Sheets Company name Company logo Name address, phone number, e-mail Date Disclaimer

Use a cover letter when sending out a business plan

Web Sites www.businessplans.org/businessplans.html www.bplans.com/sp/businessplans.cfm www.businessplanarchive.org/